Public goods can be pure or impure. Pure public goods are those that are perfectly non-rivalrous in consumption and non-excludable. Impure public goods are those that satisfy the two conditions to some extent, but not fully.
The production of public goods results in positive externalities for which producers don’t receive full payment. Consumers can take advantage of public goods without paying for them. This is called the “free-rider problem. ” If too many consumers decide to “free-ride,” private costs to producers will exceed private benefits, and the incentive to provide the good or service through the market will disappear. The market will thus fail to provide enough of the good or service for which there is a need.
For example, a local public radio station relies on support from listeners to operate. The station holds pledge drives several times a year, asking listeners to make contributions or face possible reduction in programming. Yet only a small percentage of the audience makes contributions. Some audience members may even listen to the station for years without ever making a payment. Those listeners who do not make a contribution are “free-riders. ” If the station relies solely on funds contributed by listeners, it would under-produce programming. It must obtain additional funding from other sources (such as the government) in order to continue to operate.public goods,social goods,public or social goods,social goods kya hai,public goods explain in hindi,social goods explain in hindi,example of social goods,pure public goods,example of public goods,mixed goods explain in hindi,mixed goods kya hai,mixed goods in public finance,example of mixed goods,merit goods explain in hindi,merit goods kya hai,example of merit goods,private goods,mixed goods,merit goods in public finance,public goods vs private goods